So you’ve worked out the prices for your services and you’re happy with the value for money. However, you’re not convinced a potential customer will see it that way. So how do you present your prices in the best possible light without lowering them?
We’ve gathered together seven top tips to do this.
The Magic 9
Most shops have been doing this for years – most prices you see end in ‘9’ or even ‘99’. Studies show that products sell at much higher rates when priced in this way, even by as much as a 24% increase in sales. This very effective sales tactic is based on the belief that we read from left to right so a product at £99 or £99.99 seems a much better deal than the same item for £100.
Make the price symbol smaller or remove it
By this, we mean the £, € or $ sign which serves to emphasise the price in the customer’s mind. Many companies shrink it down so that it is much smaller than the numeral. Lots of companies already use this tactic and many menus and bars leave it out altogether. US University researchers discovered that by giving people menus with and without dollar signs, the customers with the dollarless menus spent more.
Shorten your figures
If you want customers to like your prices, leave out commas and decimals. Don’t give them long numbers to read or they may start to get cold feet. A number of studies have shown that people perceive prices to be lower when they have fewer syllables. Even if we don’t read them aloud, the extra length makes them feel longer and therefore, the product must cost more.
Pad it between other prices
Many companies offer different levels of their product, for example, a starter-level followed by a standard and premium. Psychologists have observed that having three levels to choose from suits many people, as without a middle level, the higher and lower would have too much contrast and potential customers could tell themselves that they didn’t need the upgrade. Correct pricing helps to give everyone the level they want, while encouraging those who are uncertain to move up to the next rank.
Break up your numbers
Even giving customers the monthly, weekly or even daily breakdown of your prices works really well. “For less than the price of a cup of coffee” is a common tactic that many people will recognise immediately. People are more likely to pay in installments and view it as better value than having to fork out one lump sum. Research has shown that when people can ‘frame’ a cost as something manageable and real, they are more likely to purchase it.
Introduce a more expensive product
In a classic study published in the Journal Of Marketing Research, one company found that they weren’t making sales on an expensive bread maker. The solution? They placed a similar bread maker next to the original in their catalogue but costing nearly twice the price and the cheaper one sold out. This is known as the ‘anchoring effect’ so that when we see another far more expensive product, the original item will now seem like much more of a bargain.
The value prism
This copywriting technique is intended to impress people with all the ‘unseen’ craftsmanship that went into creating your product. Dyson uses this approach by detailing everything that went into their products, including how many prototypes, engineers and scientists to produce the end result. By breaking down exactly what a customer gets for their money reassures them and demonstrates your knowledge and expertise. By telling the ‘story’ of the product, this encourages an emotional link between the journey and the customer.
You may feel tempted to respond to competitors and drop your prices but this is the last thing you should do. By applying these strategies, you can strengthen your price structures and your confidence in them.